16 January 2012

That car won't start

In this article, Misha Schubert takes Brian Loughnane on face value. She dutifully reports what he says and concludes that he's defining the Gillard Government. Brian Loughnane doesn't control the Gillard Government. Brian Loughnane is Director of the Liberal Party of Australia. That's the organisation over which he has some degree of control, and he's exerting that control to tell its members to shut up.

Consider Loughnane's audience: Young Liberals, full of energy and ideas amongst other things. Bri-Bri thinks he's helping them by showing them how modern politics works, and it works in the way that people like Bri-Bri like it to work. He and Peta Credlin*, Abbott's chief of staff, started out as junior staffers who weren't responsible for making policy decisions, but who took decisions that had been made and foisted them onto journalists and minor-party Senators. Along the way they picked up no experience whatsoever in analysing the strengths and weaknesses of policy options from the point of view of those affected by the policy (as opposed to "how it plays" in the media, or with particular interest groups), or projected into the future beyond the following election. Now they are in positions where they can and do stymie the process by which policy is developed, insisting that any and all such activity be suborned to a) media and interest groups and b) their predilections above all. They must be seen to "win", and if a good idea must die for the sake of that then it's a sacrifice the Liberal Party must - and does - make.

Over the past week we have seen a much-needed debate on donations to the vehicle industry (and because there is no link to performance by the industry, and no penalties for sixty years of underperformance, let us call them for what they are: donations). Joe Hockey is against further donations; Sophie Mirabella, Eric Abetz and Barnaby Joyce are for more donations, as is the Gillard government.

This is a bizarre situation: usually Abetz and Mirabella bristle at any attempt at bipartisanship. These are people who have spent their political careers emphasising that the Liberals should be a choice and not an echo of Labor. Whenever there is bipartisanship they shake their heads and claim they don't know what the Liberal Party stands for. If you think that pink batts or school halls are salient examples of government waste, wait until you see the sheer epic scale of nation-building opportunities this country has pissed away after years and years of donations to the shareholders of Detroit and Tokyo.

As I've said earlier there might be two seats up for grabs if you don't think about it too much, and I can understand Mirabella et al focusing on that; but everybody in either Corangamite or Wakefield who is really concerned for Australian vehicle manufacturing is going to vote Labor, because they believe in vehicle industry donations wholeheartedly. The right pride themselves on being hard-hearted realists when it comes to winning votes, but on this issue they are kidding themselves.

Peta and Bri-Bri don't care what the policy is, as long as there is one - not several, one - and that all the Coalition gets 100% behind it, whatever it might be. They don't understand the process of policy development and they certainly don't want any of your broad-based input that theoretically comes with democracy, thank you very much. Bri-Bri thinks he's tough and clever by screwing down the lid on a simmering pot.

Geoff Kitney in The Australian Financial Review gave important historical context to the debate over public support for the Australian car industry in this article (you'll need to be a subscriber). He points out how the Fraser government in 1981 proposed a round of donations and the lone voice in Cabinet against them was the then Treasurer, John Howard. The then-nascent economic rationalist MPs in the Liberal Party hailed Howard and would form the core of his support during the 1980s, until they all gave up in about 1990 and were not replaced.

Kitney says that Abbott might follow in Howard's footsteps, but he has the analogy wrong. Abbott is leader of the Federal Parliamentary Liberal Party, a position held in 1981 not by Howard but Malcolm Fraser. Howard was Treasurer then; today the Liberal equivalent is Shadow Treasurer is Joe Hockey. Hockey is arguing against car industry donations in 2012, just as Howard did in 1981 (and as he never did when Prime Minister).

Economists like to mock Hockey for his apparent lack of knowledge of their profession, but he's no worse than any other Shadow Treasurer (Swan included, and yes Keating for the month or so he held that job) in that regard. Where Hockey is good value is in the old-fashioned political skill of building a consensus, and sticking it to old-timers who think they can fudge away reforms whose time has come. In the late 1990s Hockey's work on corporate law reform got up the nose of the then Chairman of AMP, Ian Burgess, who went over Hockey's head direct to Howard. When Howard stood by his minister Burgess got the shock of his life and shuffled into retirement, leaving AMP far better off for his absence.

Hockey is right on vehicle industry donations, and chances are when it comes to Liberal decision-making forums he'll have done his homework and be armed with a strong case against an industry that's only holding this country back. He'd be an iconoclastic economic reformer if he got the chance; he has already achieved more in politics than Mirabella and Abetz have or will. I would have expected the IPA to come out as strongly for Hockey as they did for race-baiter Andrew Bolt; nothing so far, nor has the CIS (whose offices are in Hockey's electorate) rallied to his side.

There is absolutely no chance at all that the Coalition will come out against donations to the car industry. Abbott always dances with those who brung him, and the right want vehicle industry donations to continue. If you read Battlelines, and if you see Abbott's performance before he became leader, you'll see him sighing and eye-rolling at every instance of bipartisanship that supposedly played into Rudd's hands. He brought down Turnbull over the bipartisanship over the ETS; the passage on the carbon price in the very teeth of his most determined opposition shows the limits of his "choice not echo" position.

Now that he has to appear less confrontational to round out his image, it will be hilarious watching him try to justify falling into line behind Labor while at the same time burning his Shadow Treasurer's attempts to "cut the waste". You can expect those half-hearted statements by Judith Sloan, Hugh Morgan et al in favour of increasing unemployment benefits to vanish overnight if the right keep on insisting Hockey cut the budget while going into bat for their pet programs.

Kitney further disgraced himself in his second article in the weekend's AFR with this idle and defenceless throwaway:
... [in 2012] Abbott can be expected to prosper.
He'll get away with murder if the more obtuse members of the press gallery continue to give him a free pass, and that's most of them. Kitney runs the risk of becoming a nostalgia act like Tony Wright if he doesn't improve in relating the landscape before him to the way things were.

After the latter part of last year's parliamentary sittings, with vast amounts of legislation passed and Abbott reduced to a frothing mess (negating Bri-Bri's insistence that the Gillard Government doesn't have a record to run on). It could go either way: either they will take Abbott seriously and call him to account for inconsistencies and evasions, or they will indulge him as he hangs his elbow out of a Holden ute and rhapsodises about how he loved to watch Brocko beat Dick Moffatt on The Mountain.

If the MSM do the latter Peta and Bri-Bri will consider their job done, and take no more interest in all that palaver about budget expenditure than most of us do - just so long as it doesn't blow up, so long as there is no public controversy over the expenditure of billions of dollars of public money. You hear that, Young Liberals? As long as everyone just shuts up, everything will be fine.

* The fact that Credlin and Loughnane are married is neither here nor there. A lot of people obsess over it but I'm not going there. The fact that they act as a team to stamp out what they don't understand and can't control, regardless of its merits, is what gets me. It can't last and within two years I expect both to be deposed.


  1. Hi Andrew

    Thankyou for another magnifcent article.

    I hope you are right about Credlin and Loughnane not lasting 2 years. They really are a miserable pair with the goodness of the Country never entering their power struggling heads. love the nick name: (Bri-Bri thinks he's tough and clever)
    Happy New Year Andrew we are looking forward to a year of your fabulous writings.
    cheers Lyn

  2. Foes of Progress, Enemies of Advancement, Apostles of Privilege.

  3. Good article as always Andrew,

    A side point on the seat of Corangamite, it's been a Liberal seat since there was a Liberal party, and was a U.A.P (conservative) seat before then. As someone who was living there at the last election I can attest that if the Libs had actually tried to win the seat rather than just assuming it would fall back into place, they would have won it and the political climate post election would have been very different and much harder for Labor.

    As to the car industry, the problem with the donations is that removing them is probably political suicide on the short term. The industry will most likely just move offshore to somewhere where the government will be happy to give them the money they are so used to, leaving the politicians who voted for it with a lot of unemployed and disgruntled workers and the opposition with a narrative on how the government is destroying our manufacturing capability. As you point out, talking about removing the donations is a game for shadow treasurers trying to prove their free market credentials, not for treasurers. Should Mr Hockey find himself as treasurer (or leader) I doubt he will even mention changing it. What I don't get is why this debate is happening in the public domain at all? Surely if this was to be Liberal policy it would be quietly talked about in cabinet and only released when everybody had signed off on it. To do it publicly like this seems slipshod at the least.

  4. Thanks Lyn and Anon.

    DaveM, I think that Corangamite is changing with the sprawl of Geelong (particularly with the Deakin Uni campus there) and one day the Libs will preselect a candidate that reflects that change.

    There is no way that the next election will be fought under the notion that a vote for the Libs is a vote against the car industry, or the end of the Holden marque. I reckon it will be done by a future Coalition government, but only after they win an election.

    It's the same way that the reforms of the Hawke-Keating government that led to the loss of thousands of manufacturing jobs are haled as a great Labor achievement. You can bet those reforms did not bubble up to Cabinet through the democratic processes of the ALP, and would have been resisted had the government checked with them. Party membership began to decline from that point and no wonder.

  5. "I would have expected the IPA to come out as strongly for Hockey as they did for race-baiter Andrew Bolt; nothing so far"

    Oh, the Drum's on for a few more nights this week yet, give it time.

    "It could go either way: either they will take Abbott seriously and call him to account for inconsistencies and evasions, or they will indulge him"

    Eh? You still at the Christmas brandy? MSM calling Abbott to account?

  6. DaveM is right re corangamite. It is now an ALP seat but will probably return to the libs. The previous member was Stewart McArthur who in his 23 years in parliament, rose to the giddy heights of deputy whip. Last time round they ran with Sarah Henderson.

    In any event, I think you should be referring to the seat of Corio which covers more of the north of Geelong and traditionally where the Ford workers lived.

  7. derrida derider17/1/12 3:31 pm

    Facile, media-bite driven policy is bad for the country, and it is true this pair's background makes them incapable of fostering any other type. But while such policy is bad for the country it is extremely effective for an Opposition - if you don't agree, just look at the polls. If Abbott has half a brain he'll deliver Ms Credlin an unpleasant surprise on the day he becomes PM (which he is still odds-on to be) by replacing her, but until then she's doing a great job for him.

    Take the car donations. Yes, rotten policy (everything you say about the Australian car industry is correct). But it happens to be wildly popular policy - in fact good policy would be wildly unpopular with shock jock listeners. Abbott would be mad to oppose those donations, especially as he can't in any case stop them going ahead. The most he can and should do is turn them into non-core promises AFTER the election.

    And then what about our government? Rotten policy done consciously from political calculation, false or otherwise, is one thing. Rotten policy done out of a foolish belief that it is not rotten is another.

  8. Anon1, there were a few sparks of doubt that Tony Abbott might make an effective Prime Minister late last year, but this seems to have dissipated so we'll see.

    Anon2, Corio hasn't been a Lib seat since Hubert Opperman held it in the 1960s. The fact that nobody really appears to understand the changes to Corangamite (except, perhaps, the incumbent MP, Mr Cheeseman) means that he's safe for now.

    dd, it's good to have you back on these boards.

    The standard criticism of populism is that it always leads to rotten policy, but this isn't always true. What happens is that good-but-unpopular policy is introduced without any engagement with the public, without any attempt to seriously involve people in the options facing the country over doing this versus not doing that. The incumbent government is not incapable of good policy, but it is largely incapable of building a case for the reforms it does make.

    The examples given by Kitney's first article cited above put the lie to the criticality of the car industry as a vote puller. The generous Lynch plan of 1981 did not save the Fraser government. Likewise, the Button car plan of 1985 played a minor role in the electoral success of the Hawke-Keating governments.

    I think that car industry donations will one day be kyboshed and that the government that does so will be re-elected. The fact that it will not engage the public beforehand will only make a mockery of the idea that voters are exercising a choice at the ballot.

    1. I seriously hope that Gillard stays the course on Pokies reform. It would be very damaging to her reputation if she were to backflip on this. With the carbon tax, she got a reputation of following through on her agreements.

      Despite the furious campaign against it, the reform has widespread community support.

      However, I stress these are only "reports" that she may back down. Nothing has been actually confirmed.

    2. Me too Bobalot, it will be another overreach by the NSW & Qld Right if she wavers on this - and they'll sheet the blame to her, as they did with Iemma and Rudd.

  9. Hillbilly Skeleton18/1/12 10:26 pm

    Well, there goes that particular theory, Andrew:


    1. No - he's only held to the Howard line about 2015, and after then you know he's going to stump up more cash.

  10. Unlike boat-people football which is played by the Canberra Football League, Auto-Worker Football is the National game, States can play too.

    Scared shit-less that mass job losses occur under their administration, team blue and team red, state and federal have all placed their own necks in the Michigan, Japan, corporate welfare noose. Buying votes is very cheap when you can do it with taxpayer cash. We need an Inquiry.

    Lets face it, neither blue nor red truely give a hoot about the common manufacturing, blue collar pleb, as both have `Free-Traded` so much Aussie manufacturing down the chute, turning Australia into a dumping ground and, placing the Nations future bets on Mining and Tourism. Mining numbers are small, 1.3% of workforce, 17% Aussie owned. I don`t know numbers for tourism, but it is largely seasonal with temporary employment. The dollar at parity with USD and, Europe and Obamaland in financial crisis, I suspect it`s not a cash-cow at the moment. Qantas better off-shore for cheaper maintainance!

    It won`t matter whether blue or red, state or federal is in charge. The vote buying welfare cheques will keep being paid, even though the Auto industry is pretty much a dead duck. Blue and red will both take it out of the oven and try to revive it around vote time.

    I like your take on the Schubert post. Those that can`t do a rudimentary SWOT analysis, Mr Rabbit, Mr and Mrs No-Queen and Schubert. Pushing `NO` as a strength for so long has really made it obvious how it`s just the weakest weakness. Pedaling imagined threats and missing all opportunities to develop some kind of realistic, useful, ideas, policy.

    1. Agre to a point, but see my response to dd above.

  11. Just to clarify, I wasn't stating that removing the car industry bribes was a bad idea, just that it's going to cause some short term pain. Given the current governments situation, why would they want to create a new enemy in the car industry? On another front, Chris Berg has written a piece which not only supports Hockey, but almost sneers at Abbott for not backing him up. Strange days indeed..


  12. DaveM, I liked the Berg piece. Labor are never going to dump donations because of the unions.

    1. http://darrencheeseman.org.au/index.php

      He's got an absolute free hit on this issue, and no media at all.

  13. derrida derider20/1/12 11:18 am

    Looks like I was wrong - Abbott has dome the politically mad thing.

    Also it looks like I was wrong on the government too - they're leaving Wilkie high and dry. They're utter idiots - didn't the ETS and mining tax events tell them that there is only one thing worse than ramming through a difficult reform and that is trying to ram it through AND FAILING.

  14. DD
    The Government is between a rock and a hard place on poker machine legislation. The PM may not really want it, but feels compelled to give it a shot to make some sort of a fist of keeping faith with Wilkie. Alternatively she may be enthusiastic, but getting 75 votes in the Reps is out of reach. I haven't heard a specific statement from her (or Wilkie) that says it's off the table; plenty of inferential stuff in the MSM, but nothing definitive.
    While it still has a little way to play out, it's difficult to speak with certainty of the current state of play. However, it does appear that getting the numbers for the original proposal of pre-commitment is proving near impossible. It may be because Oakeshott and/or Windsor have been spooked by the Clubs' campaign, perhaps that the Greens are playing funny buggers on the issue or it may be that some NSW Caucus members are succumbing to the Clubs' pressure and getting cold feet.
    I don't think it's being blindly optimistic to see some compromise, e.g. pre-commitment phased in over a longer period, or a pre-commitment trial, or the introduction of a lower limit on machines.
    We're clearly getting contrary versions of how the issue is evolving. So the next week or two should clarify things. Then it will be proper to criticise whatever deficiencies remain in the plans, and to sort the blame.